Xome Auctions-What's the reserve?
What's the reserve?
This is one of the most common questions I hear at my open houses. While the bank is working with me to pre-market, market and sell the property, they do not "reveal" the critical price point or "reserve". Many investors and buyers looking for a primary home who have experience with the auction process tell me they can "figure out" the formula. However, consider that factors change as the market changes. This triggers price increases or price improvements as necessary. The bank does not tell the listing agent the reserve amount because we would simply have an advantage and be better equipped to forge ahead of a competing agent.
Here are three items I suggest potential buyers and their agents keep in mind prior to bidding on a bank owned property:
1-Know your numbers. Just as you would have a good idea of value with a retail property purchase, the same applies with a bank owned property. Having a plan to "undercut" or "steal" a property is not likely a winning plan. Think of the bank as you would think of the "house" in Vegas. The house always wins. A winning plan is to bid what is realistic, within your budget and one that relfects market value.
2-Understand that the property is as-is,where is. This means that what you see is what you will get when you purchase. At the reserve price, above the reserve price or under the reserve price, concessions are generally not the norm.
3-Property swaps are not a practice when it comes to bank owned properties. The bank wants to get rid of the property that is being marketed...not swap it for another. They are trying to move it off their books, at or above their reserve price, not add to what they have in their inventory.
In a nutshell, the bank designates the MLS price based on a number of professional valuations. Use this price as a starting point to meeting or exceeding the unknown reserve.
Contact Me Today
Let's find you the right home at the right price.